10. Robin has just graduated with a master's degree in introspective journalism from a prestigiousuniversity and $185,000 of student loan debt. Robin has found a job as a wine and cheese blogger inNew York that pays $34,000 per year, and wants to purchase a 250 square foot apartment in Manhattanfor $300,000.Robin has taken out a loan for $485,000 from Mammon Financial, Inc. that provides the funds needed topay off the student loan debt and purchase the apartment. The loan has an annual interest rate of12.59%, with annual end of year payments required. Robin can choose the size of the payment, subjectto the requirement that a minimum payment of at least $62,854 be made at the end of each year.Robin is comfortable with these loan terms because there is an option to fully pay off the loan balanceat any time, and Robin is counting on being a beneficiary of the estate of an extremely wealthy greatuncle, thrice removed, who, according to actuarial tables, has approximately 9 months to live.If Robin does not receive any money from the great uncle's estate, how long will it take Robin to pay offthe loan by making the minimum payment each year?

in this problem we have to find out present value FACTOR and from that we can find out period…

Robin has taken out a loan for $485,000 from Mammon Financial, Inc. that provides pay off the student loan debt and purchase the apartment. The loan has an annual 12.59%, with annual end of year payments required. Robin can choose the size of th to the requirement that a minimum payment of at least $62,854 be made at the en Robin is comfortable with these loan terms because there is an option to fully pay o at any time, and Robin is counting on being a beneficiary of the estate of an extrem uncle, thrice removed, who, according to actuarial tables, has approximately 9 mon

Robin has taken out a loan for $485,000 from Mammon Financial, Inc. that provides pay off the student loan debt and purchase the apartment. The loan has an annual 12.59%, with annual end of year payments required. Robin can choose the size of th to the requirement that a minimum payment of at least $62,854 be made at the en Robin is comfortable with these loan terms because there is an option to fully pay o at any time, and Robin is counting on being a beneficiary of the estate of an extrem uncle, thrice removed, who, according to actuarial tables, has approximately 9 mon

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter14: Planning For Retirement

Section: Chapter Questions

Problem 2FPE

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